China’s economy shrank sharply in the second quarter

The Chinese economy contracted sharply in the second quarter of the year, highlighting the massive losses to activity, due to the widespread shutdowns to combat COVID-19, and pointing to continued pressures in the coming months amid a bleak outlook for global growth.
Friday’s data comes at a time of fears of a global recession; Monetary policy makers are raising interest rates to curb spiraling inflation, which is causing more hardships for consumers and businesses around the world as they face challenges from the Ukraine war and supply chain disruptions.
Official data showed that the gross domestic product declined by 2.6% in the second quarter compared to the previous quarter, once morest expectations of a 1.5% decrease and an increase of 1.4% in the previous quarter.
On an annual basis, gross domestic product in the April-June quarter grew by 0.4 percent, missing expectations for a 1.0 percent increase according to a Archyde.com poll of analysts, and a sharp slowdown from 4.8 percent in the first quarter.
In the first half of the year, GDP grew by 2.5 percent, well below the government’s target of 5.5 percent for this year.
China imposed full or partial closures in major centers across the country in March and April, including the commercial capital Shanghai, which saw an annual contraction of 13.7 percent in gross domestic product in the last quarter.
Despite the lifting of many of these restrictions since then and signs of improvement in the June data, analysts do not expect a rapid economic recovery.
Activity data for June, released on Friday, also showed that Chinese industrial production grew by 3.9 percent in June on an annual basis, compared with 0.7 percent in May, albeit less than expectations for a 4.1 percent increase in a Archyde.com poll.
Retail sales rose 3.1 percent on an annual basis in June and recorded the fastest growth in four months following authorities lifted a two-month lockdown in Shanghai. Analysts had expected a 0 percent increase following a 6.7 percent decline in May.
(Archyde.com)